In a factory, the fixed costs per unit are $60 when 500 units are produced. If 600 units are produced, the fixed costs per unit would be

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Quizplus · Accepted Answer

Fixed costs remain constant in total regardless of the number of units produced. Therefore, when more units are produced, the fixed cost per unit decreases. Total fixed costs are $60 * 500 = $30,000. When 600 units are produced, the fixed cost per unit is $30,000 / 600 = $50.00.

In a Factory, the Fixed Costs Per Unit Are $60